ONEOK to Acquire Brazos Midland Assets for $4.425 Billion

ONEOK, Inc. has entered into a definitive agreement to acquire Brazos Midstream’s natural gas gathering and processing assets in the Permian Midland Basin for approximately $4.425 billion in cash. The transaction is part of ONEOK’s broader strategy to expand its integrated energy infrastructure and strengthen its position across the natural gas and natural gas liquids (NGL) value chain.

The acquisition will be supported by a $9 billion nonvoting minority equity investment from funds and affiliates managed by Apollo. ONEOK plans to allocate approximately $5 billion of the proceeds toward reducing its existing debt. The company expects the transaction and debt reduction measures to lower its pro forma 2027 leverage to approximately 3.25 times debt-to-EBITDA, accelerating its deleveraging strategy.

The Brazos Midland assets provide ONEOK with a significant operating platform in one of North America’s most active hydrocarbon-producing regions. The system covers approximately 600,000 dedicated acres under long-term, fixed-fee contracts, with a weighted average remaining contract term exceeding 12 years. The assets are currently supported by 14 active drilling rigs operated by leading Permian producers, including ExxonMobil, Diamondback Energy and Double Eagle.

Following the expected completion of the Cassidy II processing plant in the third quarter of 2027, the acquired system is projected to include nearly 700 miles of gathering infrastructure and 1.2 billion cubic feet per day (Bcf/d) of processing capacity across seven Permian Midland Basin counties.

The acquisition will more than double ONEOK’s Midland Basin processing capacity to approximately 2.3 Bcf/d, including facilities currently under construction. It will also improve connectivity between ONEOK’s gathering, processing, NGL transportation and crude oil infrastructure.

ONEOK expects the transaction to generate additional commercial, operational and capital efficiencies through integration with its existing assets, including the West Texas NGL Pipeline and Medford NGL fractionation facility. The deal is expected to be immediately accretive to earnings and free cash flow per share, supported by contracted growth from Brazos’ dedicated acreage.

The Brazos acquisition is expected to close in the fourth quarter of 2026, subject to customary conditions and regulatory clearance. Meanwhile, Apollo’s minority equity investment is expected to close in the first half of September 2026.

Product & Chemical Commodity Price Impact

The acquisition is likely to have a moderately supportive impact on natural gas and NGL-related commodities over the medium term. Expanding gathering and processing infrastructure in the Permian Basin could facilitate higher production volumes, improve takeaway capacity and support greater availability of natural gas and NGLs. This may limit regional supply bottlenecks and create downward pressure on localized natural gas price differentials. For ethane, propane, butane and other NGLs, stronger processing and transportation connectivity could improve supply reliability while supporting higher production. However, the impact on broader U.S. chemical commodity prices is expected to remain limited, as prices will continue to depend primarily on feedstock availability, export demand, refinery operations and global market conditions.